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Henrik Zeberg

@HenrikZeberg

Apr 21

Good afternoon everyone!

A thread🧵

In October 2022, everybody was Bearish. Falling over themselves in calling for Recession and major Bear Market.

I was on the other side of that crowd. And it was honestly a fairly easy call looking at the Business Cycles. (Yes - it was!)

Leading Indicators (LEI) had NOT crossed over Equilibrium - and thereby sending Recession Signal. And Coincident Indicators (COI) were well above Equilibrium.

NOT the environment for a Recession and Major Bear Market.

We all know how that went!

Today, we have that same situation. Everybody is all "Beared-Up".

All the experts have their views on why the Economy "already is in Recession" - and the US market decline since December 2024 is first leg in a major Bear Market.

This time it is not an as easy call as back in October 2022 - but it is still fairly easy to point out why this is most likely NOT the situation.

My take: The Economy is NOT in Recession. And we are NOT in the first part of a major Bear Market. In fact, Equities and Crypto will soar higher in the final leg.

Why....?

Because the "Recession and Bear Market Thesis" does not "add up"! And people are not looking!

Let's first focus on why we don't have a Recession at this point. This one is the easy part.

And this is despite the RECESSION SIGNAL from the LEADING INDICATORS in December 2024. They are an indication, that the Economy is deteriorating - but it may take 2-4 quarters before the Economy rolls into a Recession.

So for now..

.... if a Recession was unfolding at this point, we should be able to observe that in a range of indicators. A "Recession" is not just something that "just happens out of the Blue".

It requires a serious negative feedback loop in particularly the Labor Market, which makes the Economy run backwards. Negative GDP growth for some time. And that would be visible for the observant analyst.

One thing we always observe in the initial phase of a Recession is that short duration yields drop - and drop fast.

This is US 1 year Yields.

We don't see that kind of drop in the yields, as we would expect, if a Recession was here now. And looking at Momentum (RSI) - then the "collapse" in momentum is not happening - as we have seen at the onset of previous Recessions.

Exhibit A that a Recession is NOT unfolding at this point.

Also yield spreads should begin to tell us, that the Economy is running backwards.

This is 10YR - 3Months yields spread.

It has hardly UN-INVERTED - and it has not been steepening into positive territory.

Again a piece of evidence, that the Economy is NOT in Recession at this point.

People saying the opposite are simply guessing!

I still say, that the EXTREME YIELD INVERSION we have seen is telling us, that something bad is coming our way. A major Recession - worst we have seen since 1930s.

But it is not here yet! And it tells us that we still have time to be LONG the market.

Read 6 tweets

Henrik Zeberg

@HenrikZeberg

Jan 12, 2024

Major #BlowOffTop before #Recession. The Recession will be very severe - and cause the largest Market Crash since the Crash of 1929.

This is my Outlook (January 2024)!

In early 2023, I said that I would be met with doubts and a question of "Why Recession?, as the stock market soared into late 2023 - and continues to do so into 2024.

Now we are here! My doubters are rising (and will continue to do so, as the market strengthens coming months)

The arguments are:

1) "We already had the Recession in '22"

2) "Fed is aware and will not allow it"

3) "Fed has changed the Game"

4) "We are in a new liquidity cycle"

5) "It will not be allowed in a Presidential Election year"

..... and so on!

All chitchat - and based in a complete lack of understanding of the Business Cycles.

So - why Recession? (....this is giving more than I should - so stay tuned😉)

First argument is based on our Business Cycle Model developed with Swissblock and @Negentropic_

Our Business Cycle has flashed a Recession signal in 2023. Leading Indicators have crashed under our Equilibrium Line.

In 80 years of data, the Recession Signal from our Model has NEVER been wrong. No false signals - ever!

Second argument goes on the Yield Inversion.

Yield inversion is a signal of coming Recession. Not immidiately - but eventually.

Analysts have observed this signal in 2023 - but due to impatience dismissed it. This is a great mistake.

From the bottom of the Yield Inversion, we normally see 12-15 months before a Recessions sets in. The bottom was in June 2023.

This signal is very much alive!

Read 9 tweets

Henrik Zeberg

@HenrikZeberg

Jan 15, 2022

On Wednesday, we got a CPI print of 7% over the duration of a year. Fastest since 1982! Surely, everybody can see, that #inflation is here to stay!?

NO!

WHY?

Because of the real gauges of inflation which tells us, that current inflation is due to Supply and Demand issues!

Gold Miners will soar, when REAL ECONOMIC INFLATION is here. For now, they are dead in the water - which is 100% in line with Elliott Wave predictions. "Wave C" is unfolding in 5 waves down. As surplus demand is being flushed from the system, Deflation will reemerge

Beautiful chart for GDX. Observe top in 2011 and nice decline into wave A. Then a clear ABC-correction into top in 2020, before Miners again have started a decline. Observe top in 2020! Right at 61.8% fib. Beautiful! 😉
Decline in wave C should take us just below bottom from 2015

Read 6 tweets

Henrik Zeberg

@HenrikZeberg

Jan 10, 2021

@RaoulGMI

@RaoulGMI Good Morning! You asked what is happening to #Gold and #Silver. This is my take - a summary of the governing Thesis on TheZebergReport.com for a long time! Hope you can use the input! 🙋‍♂️🙂

Since ~2000 we have been in Kondratiev's Winter. A period where GLOBAL DEBT causes low and falling growth rates. Central banks try to counter this by printing money (Monetary Stimulus). However, Deflationary forces from debt causes deflations to unfold - despite extreme measures

To the frustration of Central Banks, they cannot create inflation despite extreme money printing. They stimulate by infusing money into the system but cannot make the money circulate. Velocity drops dramatically. What they miss...You cannot solve a solvency problem with Liquidity

Read 14 tweets

Henrik Zeberg

@HenrikZeberg

Nov 22, 2020

Why do I think #Gold, #Bitcoin are about to tumble? Because of my cross-market-analyses approach with >100 charts pointing to a deflationary bust AND the Elliott Wave structures for Gold, Bitcoin and USD. Let's try investigate 1) Deflationary Thesis and 2) Elliott Wave-structures

The Deflationary Thesis is due to the patterns shaping up in all commodities. Commodities drive inflation. First GSCI Commodity Index - a very clear Ending Diagonal Triangle (Descending Wedge). Calls for DEFLATIONARY BUST before MAJOR SECULAR BOTTOM. TheZebergReport.com

#Wheat which is part of #Commodities setting direction for Inflation. Same pattern! Descending Wedge. Calls for Deflationary Bust - before Major SECULAR BOTTOM. Deflation before New Inflationary Regime! TheZebergReport.com

Read 22 tweets

Henrik Zeberg

@HenrikZeberg

May 9, 2020

These are the "events" we experience during Kondratiev's Winter. We have seen some of these but they will play out a range of times. First in 2000-03, then worse during 2007-09 and now the big one 2020-23(?). Some major dominoes are about to fall - before we reach end of Winter

Major events still to be seen (apart from rest which will be repeated and become much worse than before!): 1) Pension fund crisis 2) Run from paper money 3) War (hope not!) 4) Debt resolution (Monetary Reset?). We are NO where near end of this major crisis, which ends K's Winter

My LT #Copper chart tells me, that we may very well see the crisis (with various phases) continue until end-21 or beginning of '22. That is for the bottom in the economic activity which means, that repercussions may be felt way into 2023-25. No where near the end of this crisis!

Read 19 tweets

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